'Painful' job losses likely at Airbus

A380 delays provoke 'cost-cutting measures'

Airbus's new boss Louis Gallois has warned the company faces "painful" job losses as a result of delays to the A380 "Superjumbo" programme, the BBC reports.

Gallois, who today replaced Christian Streiff as top gun after the latter managed just three months in the big seat, said "cost-cutting measures would be evenly split between Airbus's French and German operations". He explained the plans would include the "eliminations of posts, and we will have to pose questions about sites", confirming: "There will be job losses."

Streiff is believed to have jumped ship in a dispute with Airbus parent company EADS over cash for the troubled A380 programme. He is said to have wanted more money to deal with the "wiring problems" which have now caused three delays to the commercial roll-out of the aircraft.

EADS last week announced its third revised delivery schedule for the A380. Its press release explained: "According to this revised plan, the first A380 will be delivered in October 2007. Thirteen more will be delivered in 2008 and 25 in 2009. The industrial ramp-up will be completed in 2010, when 45 A380s are going to be delivered."

The latest delay will cost EADS an extra €2.8bn in profits over the next four years, in addition to the €2bn announced in June 2006. It may also cost it some hefty compensation claims from customers such as Virgin Atlantic and Singapore Airlines which have expressed increasing disquiet over the set-backs.

The impact of the job cuts in the UK is unknown. Airbus has two British plants designing and manufacturing A380 wings - at Broughton, north Wales and Filton, near Bristol.

Rolls-Royce last week announced suspension of A380 Trent 900 engine production, although the effects on the workforce are as yet unclear. ®